Fed male Sprague-Dawley rats were given 7.5 gm. ethanol/kg body weight or an isocaloric amount of glucose. Hypertriglyceridemia occurred in 1 hour and hyper-cholesterolemia later. Liver slice experiments showed that ethanol was a better substrate for lipid synthesis than glucose. This coupled with enhanced triglyceride synthesis from fatty acids occurring within one hour of the administration of ethanol probably accounts for the hypertriglyceridemia. Ethanol, in vivo but not in vitro, also enhances the activity of hydroxy methy glutaryl CoA reductase, the rate limiting step of cholesterol synthesis. This finding may explain the hypercholesterolemia and enhanced hepatic cholesterol content that follows ethanol administration. It has also been shown that ethanol is metabolized by the pancreas but not at a rate sufficient to cause a rise in serum lipids even if released as lipoproteins. Finally it has been shown that the metabolism of ethanol by subcellular particles is different in adipose tissue as compared with liver.